A Simple Guide To SAP PP Implementation PDF

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A Simple Guide to SAP PP

Implementation
Published on June 23, 2016
Amar Deep Follow

51 7 23
SAP EAM/MM/PP/QM S4 HANA 1511 Consultant
1. Introduction
1.1 Delivering a SAP Overview Presentation to the Client
The first thing in an implementation is presenting SAP to the client team. It is expected
that the consulting team would give an overview of SAP and explain the same in a
layman language.
Mostly, the presentation is given to IT Heads, Business Resource Managers,
Manufacturing Heads and a good presentation will build a good trust, which is very
important.
A good PPT and a good presentation will convey a great message about the team and
about you as an individual.
The first interaction with the client and the organisation can be really horrifying if you
are implementing SAP in a big manufacturing organisation, and you see the big
chimneys touching the sky and Silos standing like monsters. This is where your mind
would start playing on you, and you would all of a sudden feel less confident and
doubtful about your SAP knowledge. But, the fact holds true that, bigger the
organisation better the chances of opting standard SAP.
https://www.linkedin.com/pulse/simpleguidesapppimplementationamardeep 1/16
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SAP Enterprise Structure
2. Decide the organizational Structure for SAP PP - Plants and

Storage Locations
2.1.1 Deciding facilities as Plants
Organizational structure is nothing but a simulation of physical structures and
businesses of any manufacturing unit. It is mainly categorized into three segments i.e.
manufacturing, finance and logistics, and the linkage between them is known as
integration points. Though there are multiple organization structures in SAP, but most
the manufacturing unit organizational structure consists of
Company code
Operating concern
Plant
Sales organization
Storage location
But, as a PP consultant, you are only supposed to look at plant, warehouse, planning
plant etc. parameters, and carefully configure the same.
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Typical Manufacturing Plant
Note You cannot assign a plant to more than one company code.
2.1.2 Deciding Storage Locations at the Plant
This is the most important task, a consultant needs to carryout. This organizational unit
is used to differentiate material stocks within a plant. All inventory items are stored at
storage location level.
Storage Locations for example can be Raw material receiving locations, Raw material
‘Return to Vendor’ locations, Shop Floor issuing location, Finished Goods
storage location
Illustration
Plant 1 = 0001
SLOC1 = RAW = 0001
SLOC2 = FGI = 0002
Plant 2 = 0002
SLOC1 = RAW = 0001 Sign in Join now
SLOC2 = FGI = 0002
SLOC4 = SCRAP = 0003
SAP Storage Locations
3. Understanding the Manufacturing or Logistical Business

Processes
The belowgiven points need to be considered while understanding the business
process:
3.1.1 Production Strategy
Start with finding whether the Production process is maketoorder or maketostock.
Also find, are there certain products manufactured using make to order process, and
certain products manufactured using make to stock process.
Difference between Make to Order and Make to Stock
SAP Production Planning Flow
3.1.2 Manufacturing Locations and Supply Chain
Understand the manufacturing facilities and warehousing facilities in the company and
their geographical locations. This will help you to understand the supply chain of the
company. It also becomes significant to understand the supply chain, i.e., know the raw
materials that go in to production, know their procurement methods, know the storage
locations where the raw material is stored, know from where the material is issued for
the production process, know the vendors and the existing tieup with those vendors for
procurement of raw materials.
Additionally, understand the warehousing of the raw materials as well as the finished
products, know how they are delivered from warehouse to the final customer. It is wise
to know the packing and shipping processes of the products.
Typical Manufacturing Flow Sign in Join now
3.1.3 Products Manufactured
The products which are manufactured in any manufacturing unit are called ‘Material
Master Record’ in SAP. In order to start, with the material master creation in SAP, first
make a list of the Products manufactured in various plants. You can put them in an excel
list, and understand the products and product families available. This will help you in
understanding the number of products manufactured at a plant. And, also understand
different kinds of ‘material master’ in the organization. Also, it’s very important to
decide nomenclature of any product, this can be done with the consultation of
manufacturing heads and material requirement planners.
For e.g. a car manufacturing company wants to name engines based on their engine
types and manufacturing year i.e. Petrol Engine (2015) and Diesel Engine (2015). In
this case, as a consultant, you will need to use external number assignment facility of
SAP and assign number range starting with EP2015001 for petrol and ED2015001 for
diesel. The first two letter will differentiate between petrol and diesel, next four number
will be the year of manufacture and last three number will be the unique
identifier/counter.
Different methods of production and their Outputs
3.1.4 Manufacturing Facility
The common theme of any manufacturing facility is to create ‘Finished Products’ from
the ‘Raw Material’. But, understanding the challenges faced in the Production process,
intermediate stages of production, the various machines the product goes through before
it is manufactured, is very crucial. It becomes more challenging when manufacturing
facilities are located worldwide. Deciding appropriate production process i.e. effective
usage of machines, resources, operations etc. not only help manufacturers deliver goods
on time, but also helps in maintaining the quality of the product. In order to implement
smooth production in SAP, consultants are supposed to study realtime production at
shopfloor, so that mapping becomes easier at the time of implementation.
From SAP perspective, Manufacturing Facilities will have these shop floor production
methods
Repetitive manufacturing
Discrete manufacturing, and
process manufacturing
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Stages of Manufacturing
3.1.5 Production Lead Time
Going by the definition of lead time, a latency between initiation and execution of a
process. The same goes with production lead time, the average time required to
manufacture any product. The fundamental law to study and map production lead time
is to physically examine shop floor, and also study any existing time stamping process.
This will help you set up the operations, work centers, standard production time for
producing a base quantity.
You have to understand, how you would be assigning work centers to the operations.
As, every work center has scheduling, capacity and costing related information. So, you
need to apply different formulae in order to calculate production times.
For e.g. in order to get scheduling details, you should choose/make a formula by
considering the time consumed at the work center.
A regular production would consume time equal to
[Setup time + {(Production order qty. X Std. time consumed) / Base Quantity}]
OR
A work center which processes multiple operations at one given time span can have a
capacity/scheduling formula as
{Setup time + [{Volume of Base qty. / Base qty. X (Production Order qty. 1)} /
{Volume of Furnace + 1}] X Furnace Time}.
Work Centers
3.1.6 MRP and Planning Strategies
Material Requirement Planning is the mechanism by which planners can guarantee
material availability. As, there are multiple industries catering different customers with
different needs, by producing unique products, the material requirement for production
also varies. For e.g. a fruit juice manufacturing industry will never plan all raw
materials, semifinished materials a year ahead. The planner will tabulate the planning
strategies and MRP methods for each and every component depending on the
requirement, demand and trend.
There are mainly three types of planning processes which are used, and based on the Sign in Join now

requirement from the business user, consultants are supposed to configure either
Consumption based planning
MPS Master Production Scheduling
MRP Material Requirements planning
Make a note of the different planning strategies for the Raw Materials, Finished
products, and Semifinished products. Finished and SemiFinished products usually go
through the stringent planning processes like madetoorder, madetostock, final
assembly processing etc.
AS, MRP is having strong integration points with SD (sales order, customer
requirement etc.) and MM (procurement methods, quota arrangement etc.) module, do
involve SD and MM consultants While deciding MRP and planning strategies.
MRP assignment to Material Master
4. Design of Bill of Material (BOM) and Routing/Recipes
Firstly, understand the raw materials that are consumed in the production process, and
decide which components should become a part of the Bill of Materials. As, the price
(moving average price / standard price) of each component in the BOM add up to make
the total cost of the product, thus involve the costing team as well.
SAP Bill of Material
Involve the Product development team/Product designing team or the shopfloor
managers, to decide whether a certain component or a certain product drawing and
important production related texts are to be included in the BOM.
For Routing/ Recipes, it is important to involve the costing team, as they are the one
who can help in designing the operations, which will become a part of the
Routing/Recipes. Also, the time study team or the product development team or the
costing team can make significant contributions in adding the standard machine time,
setup time required for the production of a base quantity.
5. Study of Legacy System
As we all know, with the time the technology becomes obsolete, unproductive and Sign in Join now

costlier, so studying legacy system is the foremost thing, a consultant needs to carry out.
Also, every manufacturing company has more or less their own homegrown system or
legacy system, and they do not want to lose their crucial data. In these scenarios,
understanding the Legacy system will help you know how their existing systems can be
duplicated, removed or optimized in SAP. If a legacy system can’t be replaced by SAP,
then consultant should find an effective way to interface with SAP.
E.g. a proven case, where a legacy system is interfaced with SAP are product design
software's. In most of the manufacturing firms, the product design software’s are
interfaced with SAP, which helps in direct material master and BOM creation in SAP.
6. Shop Floor Recordings and Quality Inspections
Understand the shop floor layout, and the product confirmation process at each and
every work center/operation. Also find out, how the products are received in stock, and
whether a quality inspection is carried out or not.
Shop Floor Cycle
Study the quality inspection method that is used, and how the product is
“passed/rejected”. Find out, how quality inspection of the product, is important to the
company, and whether there is a need to implement “SAP Quality Management”.
Ask the quality inspectors, whether the product is being reworked? And, what is the
scrapping process?
7. Document the Business Processes in a Blueprint Document:
7.1. 1 Blueprint – “As-Is” Versus “To-Be”
The process of documenting, the existing (AsIs) business processes, and the
corresponding future (tobe) business processes is known as ‘Business Blueprint. The
best way to do this, is to list each process one by one, and enter the relevant SAP tobe
process next to it. Also, include the step by step activities that would be the part of a
given tobe process.
The following processes may become part of your Blueprint (This is just an example)
1. Organization structure
2. Material Master: Bill Of Material, Work Center, Routing
3. Demand Management
4. Raw Material Procurement Sign in Join now
5. Raw Material Staging to the shop floor for Production
6. Material Requirement Planning for the Raw Materials, subassemblies, assemblies
7. Production order creation and Release
8. Shop Floor Execution
9. Production order Goods Receipt
10. Quality Inspections in Production
11. Product Costing and Order settlement
Note: You are also supposed to document the technical developments like interfaces,
reports, smart forms, Batch Data Communication etc. in consultation with technical
team. These developments will be used at various phases such as uploading master data,
manufacturing execution system etc.
7.1. 2 Gaps Analysis
Blueprint Gap Analysis
Gap Analysis
Gap Analysis is the process of identifying and mapping the gap between current
business operations, and the standard SAP limitations. Any business processes, which
are not supported by standard SAP, can be named as Gaps. The Gap must be
documented properly and conveyed to key business users. Usually, there are two
outcomes of the Gap Analysis.
Either, brainstorm the possible solution to overcome the gap by customization
Or, ask business whether they can change the process, in order to comply with the
standard solution. In this case, the consultant must check any deviation in legal and
financial figures, before suggesting the client.
7.1. 3 Creation of Functional specifications for the ABAP

developments
The consultants would create functional specifications for the Technical ABAP
developments. Such documents are descriptive documents, which explains the detailed
logic of developing the ABAP technical object. These documents usually contains the
field and table names, and the link between them. Based on the functional specification, Sign in Join now

ABAP team prepares technical specification and starts designing/developing technical
objects.
The technical objects, for which the Functional Specifications are generally created are:
1. Reports
2. Interfaces
3. Module Pool
4. Data Conversion Objects
5. UserExits
Note: Average time required for the Blueprinting is 23 Months.
8. Data Load and Planning
The respective module owners of the consulting team should list down all the “Master
data objects”, and the mechanism to collect data.
8.1. 1 Creation of Data Collection Templates
From SAP Production Planning and Control perspective, the consultant should design
the master data, and decide the fields for which values are to be collected from the
users, so as to create the respective master data in SAP.
For example: In case of BOM (Bill of material) creation, the consultant should consider
the value for the following fields
Selection Data: Header Material, Plant, BOM Usage, validity
Item Data: Component, item category, material code, qty., UOM, component scrap,
recursive indicator (optional), coproducts (optional)
Header Data: Base quantity, BOM Alternate text.
8.1. 2 Educating the Business Users on the Data Collection

Templates
It’s a moral duty of the consultants to provide training to the users or the super users
about the Master data template, and how they are going to use it for the collection of
master data. A consultant should be judicious while organizing such trainings since data
is the heart of any project and is used lifelong.
As a consultant, you should explain each and every field of the data collection template Sign in Join now

used for collecting the business data. You should also educate the users, what values are
expected for the fields. In some cases, you may default certain values for certain fields,
this must be conveyed to the users and the purpose of keeping it default. The template
should be very clear, and should contain the definitions and particulars about each and
every field as shown below:
Excel Row 1 Field Descriptions
Excel Row 2 SAP Field Names
Excel Row 3 Definitions and points to note
Rest of the rows Data for Collection
8.1. 3 ABAP Development for the Upload
As, the number of data records is always in large numbers, uploading manually to sap
becomes a gigantic task. In order to upload in mass, an upload program or LSMW
(Legacy System Migration Workbench) should be created in SAP. This eases the upload
process, by updating the SAP tables using excel or text file.
9. Configuration and Testing
Based on the details of the blueprint document, the SAP production planning
configuration needs to be carried out. Below given steps describe the process of
configuring production planning
Note: The client setup is the sole discretion of the customer. For security purpose, a
customer can set multiple clients for configuration, unit testing, UAT (user acceptance
test), and final move to production. Below, given steps are generic and used by most of
the customers.
9.1.1 Golden Client Configuration
A Golden client is a server in SAP, which is only used for standard configurations. This
client is only meant for standard configurations and does not contain any master or
transactional data.
9.1.2 Transfer Configurations to the Development
The development client, where consultants carry out the initial unit testing for their
respective modules. The same client is being used by the technical team for developing
the technical objects based on the functional specifications prepared in the blueprint
phase.
9.1.3 Unit Test in the Development Client

The consultants from all the modules are supposed to create a list of transaction codes Sign in Join now

or activities to test in the SAP Development client. This is basic check, where
consultants tests, whether their modules work in SAP or not. The unit test plan has to be
created in a word document or excel document before the start of the testing.
Note: Appropriate master data setup must be done prior to testing.
9.1.4 Unit Test in the Development Client
As, we all know SAP is having strong integration points, and flow of information is
very frequent between the modules, so in order to test each and every flow, we need to
carry out unit testing. While doing unit testing, usually, consultants execute end to end
business process and check whether the system is behaving as desired or not.
To have a successful test execution, it is mandatory to follow a common protocol for
documentation. Also, the document should be created beforehand and used for
recording the test results and the status of the test. A successful test allows the team to
transport the configuration to the Quality Assurance Client or the testing client.
9.1.5 Test Development Objects
In this step, the functional team tests the technical objects developed by the ABAP team
in the development client. This activity goes in parallel with the unit testing and string
testing. A functional testing document is prepared to record each and every test on the
object. All the issues reported are fixed by the technical team members. A successful
test allows the technical team to transport the workbench request to the Quality
Assurance Client (QA) or the testing client.
9.1.6 Test in Quality Environment (Client)
Once the Workbench requests and configuration requests are transferred to QA
(Quality) Client, the implementation team carries out an internal integration test for the
SAP functional and technical objects, all arranged in the sequence of occurrence.
Before, handing over to business users for user acceptance test (UAT), consultants and
IT business managers from the client IT team, creates a business process master list
containing all the business process covered, and steps to execute it.
The customer involvement plays a crucial role in this phase, as they help in testing all
realtime business processes. In most cases, the client side super users or core users are
the people who drive these tests. Nowadays, many organizations go for 3 to 4 rounds of
integration tests, in order to avoid any miscalculation.
It is important to keep a track of the Issues and Gaps which are announced out of such
tests. And make sure that, they are properly recorded in an issuetracker. The issues
must be solved by the consulting team if it’s SAP related. Whereas, if the issues are
business process related, it must be resolved by the customer team with the involvement Sign in Join now

of the SAP consultants.
9.1.7 Cutover Process and Go live
In a SAP cutover process, the consulting team and the individual consultants in the team
plan out a cutover process. A cutover in SAP means, the roll over from the existing
legacy system to the new SAP system. And to ensure this roll over is smooth, a good
cutover process or a good cutover plan is important.
Cutover forms the following:
Prepare the production client (this is the final Golive client)
Load all the master data in SAP production client.
Identify the cutover Schedules (everyone in the organization must be aware of these
dates)
Promote SAP in the organization, and create an awareness of SAP.
Make sure you have a Blackout period, which would act as a window to change your
systems to SAP and get it going in a true realtime sense. In this window, there would
be no Sales, Purchasing and Production activities. These windows are required to make
sure that, the transformation to SAP is smooth. The user community records all the
existing/open information in SAP and gets realtime handson with SAP.
Make a note of all the open documents, which are supposed to be updated in SAP such
as the open Sales orders, open production/process orders, open purchase orders, on
hand inventory etc. and upload the same within the shutdown period.
Make sure all the configuration and workbench transports have been moved to the
Production Client. As, after the Blackout period, you would be going live with SAP on
a real time basis.
SAP Cutover Activity
The cutover process for SAP PP will include:
1. Upload all the assemblies/subassemblies stocks as SAP inventory.
Note: Check with the customer regarding the physical stock, then only upload. For e.g.
If certain materials are in quality inspection, you have to upload it to Quality Inspection
stock. Similarly, if some materials are in blocked stock, you have to upload it to blocked Sign in Join now

stock in SAP.
1. Dealing with open production/process orders:
You can assume that the number of product for which the production work was in
progress before the blackout period, is finished and is in stock. Thus, you can create
inventory for these expected receipts from the production orders.
Note: After the Blackout period, avoid recording the SAP transactions for the
production/process orders which were already assumed to be finished, and were already
brought into inventory
Otherwise, you can record the current production details with the help of shop floor
manager, and create new production/process orders in the blackout period. After go
live, you can confirm the operations and create finished product stock.
9.1.8 Post Go live (Hyper Care)
The consulting team normally supports the organization for a period of 4560 days, this
period is also called hyper care support period. The issues are recorded in a shared area
or incident monitoring tool, and based on the priority, the team provides the resolution.
As the organization starts using SAP in this stage, this means consultants and super
users becomes the backbone for all kind of process or system related issues.
This stage is the most critical stage and decides the success of the project.
References
1. http://wiki.scn.sap.com/wiki/display/ERPLO/Enterprise+Structure?
preview=/58884887/262471748/JP_Enterprise_Structur01e.jpg
2. http://wiki.scn.sap.com/wiki/display/ERPMan/ERP+Manufacturing
3. https://en.wikipedia.org/wiki/Factory#/media/File:Airacobra_P39_Assembly_LOC_
02902u.jpg
4. https://help.sap.com/saphelp_470/helpdata/en/ea/e9afd14c7211d189520000e829fbb
d/frameset.htm
5. http://wiki.scn.sap.com/wiki/display/ERPLO/Process+Order+Management?
preview=/35021/1868/Picture1.jpg
6. https://help.sap.com/
7. http://scn.sap.com/ Sign in Join now
Tagged in: sap pp, sap implementation, sap
Amar Deep
SAP EAM/MM/PP/QM S4 HANA 1511 Consultant Follow
3 articles
7 comments Newest
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amarnath reddy 3mo

Module Lead at Wipro Technologies
Very Good and nice presentation.
Like Reply 1
Amar Deep 2mo

Thanks!
Like Reply
Roseane Gregório 3mo

SAP Consultant
Very good!
Like Reply 1
Amar Deep 3mo

Thanks Roseane!
Like Reply
There are 5 other comments. Show more.
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